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The promoters of India’s largest private sector company, Reliance Industries Ltd, have increased their stake in the company by converting preferential warrants into equity shares. With this, Mukesh Ambani, the chief promoter, has invested a whopping Rs 16,842 crore ($4 billion) to raise his stake from 44.8% to 54.99%. Increasing the promoters stake to 55% would have triggered an open offer, which Mukesh Ambani would not have wanted. The amount for warrant conversion has been raised by diluting his stake in other privately held companies, according to this report.

Ambani had paid 10% of the amount during the time of the allotment of preferential warrants in February 2007. The balance amount had to be paid in the next 18 months. The equity shares are subject to lock in for 3 years from the date of allotment of the warrants. The conversion has been done at a price of Rs 1,402 per share.

The cash infusion would also increase the RIL’s equity capital base increases from Rs 1,393 crore to Rs 1,513 crore.

The stock price of RIL fell to Rs 1760 yesterday, closing at its 52-week low. The share price fell by 7.67% yesterday, dragging down the Bombay Stock Exchange to 530 points down.